Featured Summary:
- Deutsche Bank sees further upside in Nigeria’s naira, supported by attractive investment yields and improving foreign-exchange conditions
- Ghana’s gold earnings and Angola’s oil revenues are drawing attention to other African currencies, although their performance differs
- Nigeria’s foreign reserves, government borrowing plans and monetary policy will influence whether the naira can sustain its gains
- Through 2027, global interest rates, commodity prices and foreign investment flows will shape returns across African currency markets
Deutsche Bank expects further gains for Nigeria’s naira, which it considers undervalued following its appreciation against the dollar in 2026.
In an October 19 client note, the German lender cited attractive yields on Nigerian securities and positive inflation-adjusted returns.
The naira has gained nearly 8% against the dollar this year, according to Bloomberg figures cited by Nigerian financial publications.
The currency’s performance follows improvements in foreign-exchange trading and renewed foreign interest in Nigerian financial assets.
Deutsche Bank also identified opportunities in Ghana’s cedi and Angola’s kwanza. Higher gold earnings have supported Ghana’s foreign-exchange market. Angola continues to rely heavily on oil exports for dollar revenues.
Nigeria’s borrowing plans remain a concern for the bank, particularly the Debt Management Office’s fourth-quarter bond issuance programme.
Additional government financing requirements could affect the naira’s outlook heading into 2027.
Nigeria’s Bond Yields Strengthen the Case for Naira Investment
At Nigeria’s October 14 Treasury bill auction, stop rates stood at 15.50% for 91-day securities, 15.80% for 182-day bills and 15.90% for the 364-day maturity.
Investors submitted ₦1.03 trillion in bids against an offer of ₦450 billion. The 364-day bills attracted ₦982.21 billion in subscriptions, while total allotments reached ₦269.06 billion.
Annual inflation eased to 14.63% in September from 15.39% in August, according to the National Bureau of Statistics.
The latest auction rates exceeded September’s inflation reading, giving investors a wider margin between quoted nominal yields and recent consumer-price increases.
Nigeria received $10.37 billion in foreign capital during the first quarter of 2026, up 83.8% from a year earlier. National Bureau of Statistics figures show that portfolio investment accounted for $9.86 billion.
Money-market instruments received $6.50 billion, while bond investments reached $3.23 billion. Equity inflows stood at $131.81 million, compared with $135.08 million in foreign direct investment.
The Central Bank of Nigeria’s electronic foreign-exchange matching system has introduced a more structured process for interbank currency trading.
Changes to foreign-exchange access have also eased some of the restrictions previously faced by market participants.
For international investors financing purchases in dollars, the attraction of Nigerian yields must be weighed against borrowing costs and any depreciation of the naira before their investments mature.
Ghana’s Gold Earnings and Angola’s Oil Revenues Support Their Currency Outlooks
Ghana earned $14.86 billion from gold exports during the first eight months of 2026, compared with $11.18 billion a year earlier, according to the Bank of Ghana. Gold represented roughly two-thirds of merchandise export earnings.
The Ghana Gold Board reported $1.87 billion in foreign-exchange proceeds from artisanal and small-scale gold operations in September.
It sold $701.3 million to commercial banks and supplied $1.17 billion to the central bank for reserve accumulation.
Gross international reserves reached approximately $12.05 billion on September 22, covering 4.5 months of imports. The cedi traded around 11.60 per dollar in mid-October.
Angola’s merchandise exports rose 12.3% in the first quarter of 2026, according to government figures. Crude oil export receipts increased 21.9%. International reserves stood at $15.9 billion at the end of March.
The National Agency for Oil, Gas and Biofuels reported September production of 1.045 million barrels per day, up 3.95% from August but 1.30% below September 2025.
The International Monetary Fund forecasts $34.1 billion in Angolan oil and gas export earnings for 2026, against $28.1 billion in 2025, using an assumed average oil price of $79.10 per barrel.
The Banco Nacional de Angola quoted the kwanza at approximately 913 per dollar. Oil production and export receipts remain central to Angola’s foreign-currency supply.
Nigeria’s Reserves and Borrowing Plans Will Test Deutsche Bank’s Naira Outlook
Nigeria’s Debt Management Office plans to offer ₦5.75 trillion in Federal Government bonds during the fourth quarter of 2026.
Bond allotments reached ₦7.15 trillion in the first nine months of the year, more than double the ₦3.48 trillion recorded a year earlier.
The provisional calendar lists ₦1.75 trillion for October and ₦2 trillion each for November and December, covering bonds maturing in 2034, 2036 and 2038.
Deutsche Bank identified government borrowing as a risk to further naira appreciation in its reported October 19 client note. The lender expects higher public spending to increase Nigeria’s financing requirements.
Public debt reached ₦166.79 trillion at the end of June, up from ₦159.35 trillion in March, according to the Debt Management Office. Further bond issuance could raise borrowing costs if investor demand weakens.
The Central Bank of Nigeria’s revised figures placed gross external reserves at $55.07 billion on October 9.
The naira closed at ₦1,333.76 per dollar in the official market on October 19, with reported foreign-exchange turnover of $40.98 million.
Foreign purchases of Nigerian securities can increase dollar supply in the domestic market. Official reserves rise from those transactions only if the central bank acquires the foreign currency, after accounting for other changes in its holdings.
Government borrowing costs will depend partly on the demand for new bond issues. Nigerian companies seeking local-currency financing also face competition for investment funds, particularly if government securities offer higher yields.
Higher U.S. interest rates could reduce the appeal of Nigerian debt to international investors through 2027.
Changes in oil prices will affect export receipts, while expectations of further naira depreciation could erode the returns foreign investors earn on Nigerian securities.
Nigeria’s Naira Has Room to Strengthen Through 2027
Deutsche Bank sees further upside in the naira as Nigeria’s improving foreign-exchange market, easing inflation and attractive investment yields strengthen demand for local assets.
The bank’s valuation assessment suggests that the currency’s recovery has not exhausted its potential gains.
Nigeria approaches 2027 with foreign reserves providing support for its external position and international investors returning to domestic financial markets.
Further inflation declines could improve returns on naira investments, particularly if access to foreign exchange remains reliable.
The next measure of the currency’s strength will be its performance as government financing needs increase and global interest rates change.
Sustained stability would support business investment and strengthen Nigeria’s appeal to international capital beyond short-term currency trades.
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